We investigate the factors behind the growing U.S. trade deficit in consumer-oriented agricultural products by using reliable panel data and an empirical trade model derived from international trade theory. The results indicate that per capita income in the United States appears to be the most important determinant for the growing U.S. trade deficit. An increase in per capita income and trade liberalization in foreign countries would improve U.S. trade balance. U.S. foreign direct investment abroad in food manufactures, a strong U.S. dollar and NAFTA are found to have negative effects on U.S. trade balance.


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